Newmarket officials to discuss audit findings

Friday

Nov 30, 2007 at 3:15 AMNov 30, 2007 at 6:10 AM

By GRETYL MACALASTER

NEWMARKET — The formation of an audit committee, an accounts payable policy and the town's credit card policy will be the topics of discussion at a special meeting on Dec. 12 dealing with the forensic audit findings.

The council is meeting nearly every week from now until at least Christmas to deal with regular business and the findings of the extensive audit on town finances in fiscal year 2006, which revealed a number of budget and accounting inaccuracies.

Town Council Chairman Brian Hart presented a table detailing actions recommended by Graham & Graham, other councilors and community members, that should be taken, when to take them, who is responsible for oversight, status checks and when it is to be discussed.

Council members agreed to limit the length of the meeting on Dec. 12 to two hours, confident that this will be just one of many special meetings to be held to deal with the fallout of the forensic audit findings.

"I think this is going to be an ongoing discussion for quite some time," Councilor Jennifer Jarvis said.

The extensive audit report included allegations of document shredding, altered earned time records, "stealth transactions" by town officials and $3 million in "various assets," which could not be individually identified by the town's former auditor.

The report was especially critical of former Town Administrator Al Dixon, former Finance Director Melodie Hodgdon and Paul Mercier, C.P.A., the town's former auditor, all longtime associates who left another New Hampshire town in a cloud of controversy back in the 1990s.

The council will discuss what an audit committee is and what its responsibility will be. The committee would likely be made up of community members with some financial background and council members. The committee would provide oversight to ensure management is following the town's policies and procedures.

Hart said the staff has been working hard to put into place better accounting practices and have been busy creating policies for the council's review. But with budget season upon them, new auditors coming in next month and their regular duties, it is important for council members and others to make sure the staff does not share an undue burden.

Town Administrator Ed Wojnowski also presented the council with a job description for a full-time assistant in the finance office. Right now the department is made up of Finance Director Don Parnell and two part-time employees. Parnell has indicated he needs more help to make sure things are running properly.

Hart said Dixon indicated before he left that the office was going to need more help, but at the time Parnell did not think so.

The council will discuss the proposal at its Dec. 5 meeting.

Councilor Rose Anne Kwaks asked that the council review the new credit card policy as she is concerned about some of the things she saw in 700 pages of supporting audit documents related to use of credit cards by town employees.

Parnell said in a previous interview that he is working to tighten up the town's use of credit cards and is looking at having the town switch to American Express because it is a more "business friendly" card and is not tailored to personal use as Visa and MasterCard are.

Parnell presented a temporary accounts payable policy in an effort to formalize the accounts payable process until the town formally adopts one. The council will also review this policy Dec. 12.

@Subhead:Criminal Investigation

Hart told the council there is no update from the state Attorney General's office or the Rockingham County Attorney's office as to the status of any criminal investigation.

Town Attorney Peter Taylor has recommended the town wait until any criminal investigation is complete before pursuing civil action. In his findings, auditor Jeff Graham recommended the town take action to recoup town assets and funds used for inappropriate or unauthorized purchases by employees and to recoup the town's cost for the forensic audit from responsible parties.

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